Case 1:96-cv-04849-ERK-JO Document 5040 Filed 03/28/19 Page 1 of 92 PageID #: 19256 In re Holocaust Victim Assets Litigation (Hon. Edward R. Korman) Final Report on the Swiss Banks Holocaust Settlement Distribution Process, Special Master Judah Gribetz and Deputy Special Master Shari C. Reig EXECUTIVE SUMMARY UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK X : Case No. CV 96-4849 (ERK)(MDG) : (Consolidated with CV 96-5161 and : CV 97-461) : : : IN RE: : HOLOCAUST VICTIM ASSETS : LITIGATION : : This Document Relates to: All Cases : : : X SPECIAL MASTERS’ FINAL REPORT ON THE SWISS BANKS HOLOCAUST SETTLEMENT DISTRIBUTION PROCESS EXECUTIVE SUMMARY Judah Gribetz Special Master Shari C. Reig Deputy Special Master Morgan, Lewis & Bockius LLP 101 Park Avenue New York, New York 10178 March 28, 2019 DB3/ 201537552.1 Case 1:96-cv-04849-ERK-JO Document 5040 Filed 03/28/19 Page 2 of 92 PageID #: 19257 TABLE OF CONTENTS Page I. EXECUTIVE SUMMARY .......................................................................................... 1 II. THE $1.25 BILLION SWISS BANKS HOLOCAUST SETTLEMENT .................... 2 III. THE BACKGROUND................................................................................................ 12 IV. SUMMARY OF DISTRIBUTION PROGRAMS ...................................................... 24 V. THE DISTRIBUTION PROGRAMS ......................................................................... 31 A. The Deposited Assets Class ............................................................................ 31 1. The Claims Program ........................................................................... 31 2. Concealment by the Swiss Banks ....................................................... 33 B. The Looted Assets Class ................................................................................. 47 C. Slave Labor Class I ......................................................................................... 55 D. Slave Labor Class II ........................................................................................ 66 E. The Refugee Class .......................................................................................... 73 F. Insurance Claims ............................................................................................. 82 G. The Victim List Project ................................................................................... 85 i DB3/ 201537552.1 Case 1:96-cv-04849-ERK-JO Document 5040 Filed 03/28/19 Page 3 of 92 PageID #: 19258 In re Holocaust Victim Assets Litigation (Hon. Edward R. Korman) EXECUTIVE SUMMARY I. EXECUTIVE SUMMARY Switzerland was a neutral nation during the Second World War. Both before and after Hitler’s accession to power in Germany in 1933, Swiss banks appeared to provide a financial haven where foreigners at risk could safely deposit their funds. For decades after the war, though, Nazi victims and their families were told that if they were seeking property taken from them during the Holocaust, Swiss banks were not the place to look. The banks said that they had never held victims’ accounts; or had there ever been such accounts, they were no longer in existence; or if any accounts still remained, there were only a small number with minimal value; or whatever records might once have existed no longer were kept. They said that the person asking could receive no further information without providing proof of who the account owner was, how that person was related, and how that person died (even if at the hands of the Nazis, who did not generally hand out death certificates, although Swiss banks nevertheless often continued to demand such proof of death). Account owners and their heirs were turned away time and time again, but they did not forget and they did not give up. Finally, in the 1990s, they obtained a forum to pursue their property: the United States judicial system. Because of that forum, more than 458,400 Holocaust victims and heirs worldwide have received nearly $1.285 billion in compensation arising from the Holocaust-era activities of Swiss banks and other Swiss institutions. This Executive Summary provides an overview of the principles and decisions that guided the distribution process.1 1 This Executive Summary of the Final Report is intended to provide a summary of the processes that are described in detail in the complete Final Report. Since it is anticipated that not all readers will have the time or -1- Case 1:96-cv-04849-ERK-JO Document 5040 Filed 03/28/19 Page 4 of 92 PageID #: 19259 In re Holocaust Victim Assets Litigation (Hon. Edward R. Korman) EXECUTIVE SUMMARY II. THE $1.25 BILLION SWISS BANKS HOLOCAUST SETTLEMENT In 1996 and 1997, a series of class action lawsuits were filed in several United States federal courts against Swiss banks and other Swiss entities. These lawsuits alleged that financial institutions in Switzerland collaborated with and aided the Nazi regime by knowingly retaining and concealing assets of Holocaust victims, and by accepting and laundering illegally obtained Nazi loot and profits of slave labor. All of the cases were consolidated in the United States District Court for the Eastern District of New York (“the Court”). The lawsuits were litigated by Professor Burt Neuborne and a team of leading U.S. class action attorneys. Judge Edward R. Korman, before whom the litigation was pending, actively encouraged the parties to settle. With his assistance, the parties reached a settlement in principle in August 1998 for $1.25 billion, to be paid jointly by Switzerland’s two major banks, United Bank of Switzerland (“UBS”) and Credit Suisse, creating a class action fund to be administered by the Court.2 A formal Settlement Agreement was executed on January 26, 1999 (the “Settlement Agreement” or the “Settlement”). The Settlement had the support of the United States government, which had first become involved with the matter in 1994, when Stuart E. Eizenstat, then serving as U.S. Ambassador to the European Union, had initiated an inquiry into the Holocaust-era activities of Swiss banks. Ambassador Eizenstat continued to oversee the U.S. government’s role in matters of Holocaust compensation and played an important part in bringing about the Swiss Banks Settlement.3 It was envisioned that the Settlement Fund would opportunity to read the full Final Report (approximately 2,000 pages including exhibits and bibliography), some excerpts from the Final Report are repeated in their entirety in this Executive Summary. 2 The Swiss government did not participate in the settlement and paid no part of the Settlement Fund of $1.25 billion. 3 Ambassador Eizenstat served variously in many governmental roles, including as President Clinton’s Under Secretary of State for Economic, Business & Agricultural Affairs, Under Secretary of Commerce, Deputy Secretary of the Treasury, and Special Representative of the President and Secretary of State for Holocaust-Era Issues. He remains actively involved with Holocaust compensation issues. He described his experiences with the negotiation of claims arising from accounts held in Swiss bank accounts, slave labor on behalf of German and Austrian corporate and governmental entities, and other Holocaust-era injuries, in his book IMPERFECT JUSTICE: LOOTED ASSETS, SLAVE LABOR, AND THE UNFINISHED BUSINESS OF WORLD WAR II. (PublicAffairs 2003). In addition to Ambassador Eizenstat’s account, analyses of the Swiss Banks and other Holocaust litigation and settlement include, among others, Professor Michael J. Bazyler’s chapter, Achieving A Measure of Justice and Writing Holocaust History through U.S. Restitution Litigation, in RETHINKING HOLOCAUST JUSTICE: ESSAYS -2- Case 1:96-cv-04849-ERK-JO Document 5040 Filed 03/28/19 Page 5 of 92 PageID #: 19260 In re Holocaust Victim Assets Litigation (Hon. Edward R. Korman) EXECUTIVE SUMMARY be distributed among five different victim groups (ultimately designated under the Settlement Agreement as those who were or were believed to be Jewish, Romani, Jehovah’s Witness, homosexual or disabled), and among five different settlement classes (the Deposited Assets Class, Slave Labor Class I, Slave Labor Class II, the Looted Assets Class, and the Refugee Class). The Settlement Agreement did not establish a specific method of allocating the Settlement Fund among these diverse victim groups and classes. Rather, the agreement provided for the Court to appoint a Special Master to employ “open and equitable procedures to ensure fair consideration of all proposals for allocation and distribution.”4 The Plaintiffs’ Executive Committee on December 15, 1998 unanimously endorsed the Court’s proposal to appoint Judah Gribetz as Special Master, responsible for devising the distribution plan. Shortly thereafter, on January 26, 1999, the parties signed the Settlement Agreement, and on March 31, 1999, the Court issued an order formalizing Mr. Gribetz’s appointment. The Court approved the Settlement Agreement on July 26, 2000, at the same time imposing important conditions intended to facilitate the review of claims, including the production of records relating to Swiss bank accounts, Swiss use of slave labor, and refugees.5 On September 11, 2000, the Special Master filed the Proposed Plan of Allocation and Distribution of Settlement Proceeds (“Distribution Plan”), which the Court approved in its entirety on November 22, 2000, a decision ACROSS DISCIPLINES 235 (Norman J. W. Goda ed., Berghahn Books 2017); Michael Bazyler, www.swissbankclaims.com: The Legality and Morality